Lord Clinton-Davis: My Lords, I am sorry to say that I heard nothing from the noble Lord that indicated that the matteror something like itcould not be dealt with by order, although the Government ought to have regard to the principles outlined by the noble Lord. I want to consider the matter more than I have done, but I do not think that anything that has been said so far makes it appropriate to amend the Bill. I go a long way with the noble Lord, Lord Goodhart, on the issue but not as far as he wants me to.

Lord Hunt of Wirral: My Lords, I follow the noble Lord, Lord Goodhart, in a debate that is similar to one that we had in Committee. I have already spoken to the matter in general terms in connection with the previous amendment, but, as Amendment No. 153 is included in the group, I thought that I ought to explain why I tabled it.

The amendment would insert the word "only" into Section 2B(3), so that the list of circumstances in which the Lord Chancellor may make an order is restricted to the list set out in that subsection. That would clarify the Government's acceptance of the previous amendment, moved by the noble Lord, Lord Goodhart, which took out the Lord Chancellor's power to make an order that operated irrespective of the terms of any court order or agreement.

I want to give the Minister the opportunity to satisfy the House that the Government accept that the section, as now drafted, will permit the Lord Chancellor only to make orders that are within the scope of subsection (3)that is, orders that will only operate wholly or partly by reference to a condition in the court order or agreement. This is the proposed restriction to circumstances equivalent to provisional damages by ensuring that a court order or agreement can be varied only if the original order provides for circumstances in which that variation can take place.

Amendment No. 154 would leave out new Section 2B(3)(d), which would enable the Lord Chancellor to create rules of court in the order. We are aware that the Lord Chancellor will consult widely on the proposed secondary legislation and that such consultation will include practitioners, but we feel that the Civil Procedure Rule Committee is the best place for drafting rules of court. Rules need to work for the judiciary and for practitioners, and I am not sure that the noble and learned Lord the Lord Chancellor is best placed to make those decisions.

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Amendment No. 155 would remove new Section 2B(4), which is, in effect, a Henry VIII clause, entitling the Lord Chancellor to amend primary legislation on provisional or further damages. Can the Minister explain that? Whatever she may say about the restrictive use of such a power, it would enable the Government effectively to change the way in which damages are paid by a substantial extension of the scope of provisional damages. It is subject to the affirmative resolution procedure, but I am a little concerned that that is hardly an effective way to amend primary legislation.

Will the Minister give us some reassurance on those points? I thought that it might be helpful if I dealt with those three amendments at this stage.

6.30 p.m.

Baroness Scotland of Asthal: My Lords, I thank my noble friend Lord Clinton-Davis for his support on the amendments. I agree with him that they are not appropriate. In the interests of clarity on the issue, I shall go through them amendment by amendment. I accept that it is a difficult area. There has been a lot of discussion and debate about this, but we have an opportunity to see whether we can reach a modicum of agreement.

Amendment No. 151 would restrict the scope of any order that the Lord Chancellor can make allowing the upward variation of periodical payments to the circumstances in which provisional damages can currently be awarded. By preventing the making of any order allowing upward variation in any terms different from those specified, the amendment would defeat the purpose of providing for variation through an order-making power.

As I said in Committee, the Government have no plans to extend the scope of variation after the initial order. However, that should not prevent us from keeping open the option of extending or limiting further the extent of variation, for example, in the light of experience and further developments in the insurance market or making any minor adjustments, should they prove necessary. The order-making power provides the flexibility to do this. It is important that this flexibility is not undermined. In relation to the previous group, the noble Lord, Lord Hunt, raised the issue of satellite litigation and the need to hone matters to ensure that they are right. There should be flexibility to change by order affirmative resolutions so that Parliament has an opportunity to look at it. That is what we are seeking to do; namely, to get the structure right but retain the flexibility if, from experience, we find that the assumptions we make now are not founded in fact.

Furthermore, by basing the restrictions to the order-making power on provisional damages legislation and by referring solely to increases in payments resulting from a deterioration in the claimant's condition, the amendment would prevent us from making the initial order in the terms which we propose. Provisional damages do not allow for an improvement in the claimant's condition, nor do they allow the defendant

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to apply. We believe that variable payments should be available in these circumstances, not least to put claimants and defendants on a level playing field so far as is possible.

Although we recognise the noble Lord's concern that the provisions governing variation should not be too open-ended, we do not believe that restricting them in the way suggested is necessary. The need for consultation and affirmative resolution provides the necessary safeguards to ensure that the order-making power is used reasonably and responsibly.

Amendment No. 153 limits the provisions that may be included in an order to those listed on the face of the Bill. We have all previously said that this is a developing area of law; it is important that the framework for the order-making power is flexible enough to cater for future eventualities that cannot yet be foreseen. We believe that it would therefore be unhelpful to limit the provision in the way suggested.

Amendment No. 154 removes the provision in new Section 2B(3) enabling an order allowing variation to make provision of a kind which could be made by civil procedure rules. I set out the position of the Government on this issue in Committee. The provision will not enable the Government to do any more than can already be provided for under rules of court. But it may be more efficient to deal with all provisions relating to variation wholly by order rather than a mix and match of rules and orders.

As the House is aware, rules of court made by the Civil Procedure Rule Committee must first be allowed by the Lord Chancellor and are then subject to negative resolution by Parliament. However, any provision which is implemented by way of an order will be subject to the affirmative resolution procedure. As this provides a higher level of scrutiny than is currently provided by the rules, we do not accept that this provision should cause any concern. In fact, we suggest that it should be welcomed.

Finally, I turn to Amendments Nos. 155 and 156. These would prevent the Lord Chancellor making an order which amended legislation governing provisional damages. Amendment No. 155 would also prevent an order applying such legislation. As I said, again in Committee, to ensure that provisional damages can operate effectively alongside variable periodical payments, it may be necessary to make amendments to the legislation that governs those damages. There may be cases where both lump sums and periodical payments are needed. We believe that the best way of ensuring the combatthat was a Freudian slip, was it not?I meant "compatibility" of the two systems is through the order-making power.

I am, of course, aware of the concerns that this power could potentially allow substantive amendments to the scope of provisional damages. However, we believe that the need for consultation and affirmative resolution provide adequate safeguards to its use. They will ensure that any future order for variation, including one that made amendments to provisional damages legislation, would be subject to rigorous scrutiny and debate. If Parliament is not satisfied that

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the power is being used appropriately, it will be able to indicate that under the affirmative resolution procedure.

It should give noble Lords comfort that what we have in the procedure that we are now adopting, and have in practice sought to adopt over a number of years, is the practitioner, the courts and the industry working together to obtain the best solutions possible to resolve these issues of personal injury. We should congratulate the committees which have worked together on the rules and orders which have proved to be sensible and workable and have worked to the advantage of all litigants. I reasonably anticipate that this will be the case too. In the light of all that I have said, I hope that the noble Lord, first, is reassured and, secondly, is content enough to withdraw the amendment.

Lord Goodhart: My Lords, I am grateful for the comments made by the noble Baroness and I am partly persuaded. Amendment No. 151 is somewhat too rigid. The residual problem is that there should not be a reopening of the case unless at the time of the original order notice is given, in effect, to the parties that the case may be reopened. It is important that where the court hears a case and makes what it and the parties at the time believe to be a final decision, there should not be a subsequent reopening of the caseexcept, of course, on grounds such as fraud and so forth on which cases can now be reopened.

In the circumstances, in the rather brief time available, I shall consider whether I want to table at Third Reading a more restricted form of amendment which will not put a tight band on the kind of variations which can be made but will limit variations to cases where the court, at the original hearing, has said that variations may subsequently be applied for. Be that as it may, today I beg leave to withdraw the amendment.